Virgin Media O2 to cut thousands of jobs as £27.2bn debt load bites

Virgin Media O2 is preparing to make thousands of redundancies as it moves to reduce costs under a £27.2bn debt pile and intensifying market competition, the BBC reported.

The broadband provider has not finalised the number of roles to be cut, but the reductions are expected to represent a sizeable share of its 16,000-strong workforce. The majority of affected positions are expected to be in non-customer-facing roles, and a number of senior leadership changes are already under way.

VMO2 holds assets worth £45.9bn against its total debt as of 30 June, according to its latest accounts. The company is also reviewing its use of contractors and suppliers as part of the cost-saving exercise.

The Prospect union said the cuts were "disappointing and very unsettling". Deputy general secretary Noel McClean said the union was committed to supporting members through what he called a difficult time, as well as working with the employer to mitigate redundancies and explore retraining and redeployment options.

VMO2 declined to comment.

The firm faces pressure from cheaper altnet providers including Hyperoptic, Community Fibre, Gigaclear and YouFibre, as well as from BT, which received regulatory approval from the Competition and Markets Authority to acquire TalkTalk in October — a deal VMO2 called a "stitch-up".

VMO2's own attempt to acquire altnet competitor Netomonia for £2bn via its nexfibre joint venture was blocked by the CMA.

Separately, BT's share price rose 7% on Friday after reports that VMO2 was close to agreeing a deal to use BT's fibre broadband network. VMO2 is expected to announce a halt to all investment in its own fibre infrastructure when it reports results on Tuesday.